When a Nation First Begins to Trade with Other Countries

question 84

Multiple Choice

When a nation first begins to trade with other countries and the nation becomes an exporter of soybeans,

• A)this is an indication that the world price of soybeans exceeds the nation's domestic price of soybeans in the absence of trade.
• B)this is an indication that the nation has a comparative advantage in producing soybeans.
• C)the nation's consumers of soybeans become worse off and the nation's producers of soybeans become better off.
• D)All of the above are correct.

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Definitions:

Receivables Turnover

A financial ratio that measures the efficiency of a company in collecting its accounts receivable or the speed at which it turns its receivables into cash.

Inventory Turnover

A ratio showing how many times a company's inventory is sold and replaced over a specific period, indicating its efficiency in managing and selling stock.

Liquidity

The ease with which an asset can be converted into cash without significantly affecting its market price.

Days In Inventory

A financial metric that indicates the average number of days a company takes to turn its inventory into sales.